Statement of
John M. Galvin
Acting Commissioner
Bureau of Labor Statistics
before the
Joint Economic Committee
UNITED STATES CONGRESS
Friday, February 3, 2012
Mr. Chairman and Members of the Committee:
Thank you for the opportunity to discuss the employment and
unemployment data we released this morning.
The unemployment rate decreased to 8.3 percent in January,
and nonfarm payroll employment rose by 243,000. In 2011, nonfarm
employment increased by an average of 152,000 per month. Job
growth was widespread in the private sector in January, with the
largest gains occurring in professional and business services,
leisure and hospitality, and manufacturing.
Professional and business services added 70,000 jobs over
the month, compared with an average monthly gain of 48,000 in
2011. Nearly half of the January increase occurred in employment
services (+33,000), as temporary help employment continued to
trend up. Also within professional and business services,
employment rose in accounting and bookkeeping (+13,000) and in
architectural and engineering services (+7,000).
Employment in leisure and hospitality increased by 44,000,
mostly in food services (+33,000). Health care employment rose
by 31,000, with job gains in hospitals (+13,000) and ambulatory
care services (+13,000). Employment in both wholesale and retail
trade continued to trend up over the month.
In the goods-producing sector, manufacturing employment
increased by 50,000 in January, nearly all in durable goods
manufacturing. Fabricated metal products, machinery, and motor
vehicles each added jobs. Over the past 2 months, construction
employment rose by 52,000, mainly among nonresidential specialty
trade contractors. Mining employment continued to expand in
January (+10,000). Since a recent low point in October 2009,
mining has added 172,000 jobs.
Government employment changed little in January. Over the
last 12 months, employment in the sector has decreased by 276,000
with declines in local government; state government, excluding
education; and the U.S. Postal Service.
Average hourly earnings of all employees on private nonfarm
payrolls increased by 4 cents in January to $23.29. Over the
past 12 months, average hourly earnings have risen by 1.9
percent. From December 2010 to December 2011, the Consumer Price
Index for All Urban Consumers (CPI-U) increased by 3.0 percent.
In accordance with annual practice, the establishment survey
data released today reflect the incorporation of benchmark
revisions. Each year, BLS re-anchors the sample-based survey
estimates to full universe counts of employment, primarily
derived from administrative records of the unemployment insurance
tax system. The level of nonfarm payroll employment in March
2011 was revised up by 162,000 (not seasonally adjusted) or 0.1
percent. The average benchmark revision over the past 10 years
was plus or minus 0.3 percent. (Further information about the
impact of the benchmark revision is contained in our news release
and on our Web site at http://www.bls.gov/web/empsit/cesbmart.htm.)
Before discussing the data from our survey of households, I
would note that, as is our annual practice, we have incorporated
new population controls into the January estimates. Data
beginning in January 2012 reflect population controls based on
Census 2010, updated information on net international migration,
and some methodological adjustments in the estimation process.
Official estimates for December 2011 and earlier months will not
be revised to incorporate the Census 2010-based controls. The
impact of the new controls on the unemployment rate is
negligible. However, two important household survey measures,
the employment-population ratio and the labor force participation
rate, are lowered by a change in the composition of the
population (based on comparisons of December 2011 estimates
computed using the old and new controls). The new controls raise
the population of persons 55 years and older and, to a lesser
extent, persons 16-24 years of age. Both of these groups are
less likely to be in the labor force than the general population.
(Additional information about the Census 2010-based population
controls and impact can be found in our news release and on our
Web site at http://www.bls.gov/cps/cps12adj.pdf.)
Returning to the data for January, the unemployment rate
continued to decline over the month. Since August 2011, the
jobless rate has fallen from 9.1 to 8.3 percent, and the number
of unemployed persons has declined by about 1.2 million. In
January, the number of persons unemployed for 27 weeks or more
was little changed at 5.5 million and made up 42.9 percent of the
total. The employment-population ratio increased over the month,
and the labor force participation rate was unchanged, after
accounting for the impact of Census 2010-based population
controls.
To summarize January’s labor market developments, nonfarm
payroll employment increased by 243,000, and the unemployment
rate decreased to 8.3 percent.
My colleagues and I now would be glad to answer your
questions.